Councils defended for management of £375m in section 106 receipts

Senior figures have defended councils after a report that they are hoarding hundreds of millions of pounds set aside for affordable homes.

The Huffington Post this week ran an article showing that local authorities have a total of £375m unspent cash from section 106 agreements.

However, many in the sector say that there are practical reasons why the section 106 money — not all of which has been allocated for affordable housing — is yet to be spent.

Mike Kiely, chair of the board of the Planning Officers Society, told Room151 the headline figure was not as dramatic as it sounds.

He said: “There are 326 district level authorities in England, so it is only just over a million pounds per authority.

“A lot has to be brought in and pooled before it can be spent.

“A primary school serves a large number of homes and all of that money — it can be around £10m for a primary school — needs to be collected.”

Others in the local government sector pointed out that much of the money may be for development plans which are yet to reach a point where funding can be committed.

The Huffington Post report found that London Borough of Southwark has the largest sum of section 106 money in the bank, with £52.6m.

A statement from Southwark said: “We can confirm that the balance of section 106 receipts for affordable housing not yet spent has been committed to specific projects, including those currently in the pipeline. All the schemes identified are projected to be complete by 2022/23.”

According to the Huffington Post, Clive Betts, chairman of the Housing, Communities and Local Government Select Committee, said his committee would look at the issue.

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